Joyce SHIRLEY, Plaintiff-Appellant, v. STATE NATIONAL BANK OF CONNECTICUT, Defendant-Appellee.
No. 222, Docket 73-1783.
United States Court of Appeals, Second Circuit.
Argued Dec. 10, 1973. Decided Feb. 14, 1974.
493 F.2d 739
The procedure followed in Telfaire, suggesting model identification instructions in this type of case, merits further attention. If the trial courts are constantly aware that certain instructions, varied to meet specific cases, are to be given whenever identification is an important issue, it is more likely that the defendant‘s right to an informed consideration of his case will not be diluted and the number of appeals such as this may well be substantially reduced.18 On balance, it may be wiser to reverse the defendant‘s conviction, based in large part on the informant‘s possession, after allegedly meeting with the defendant, of four glassine packages of heroin, and, at the same time, take the opportunity to provide district courts with more definite guidance with respect to the necessity for and content of identification charges.
Accordingly, I would reverse the judgment of the district court and remand for a new trial.
Neal Ossen, Hartford, Conn. (Mary R. Hennessey, Robert Dombroff, Hartford, Conn., on the brief), for plaintiff-appellant.
Francis J. McNamara, Jr., Stamford, Conn. (John F. Spindler, Robert W. Worley, Jr., Fredric H. Weisberg, and Cummings & Lockwood, Stamford, Conn., on the brief), for defendant-appellee.
Before KAUFMAN, Chief Judge, and MANSFIELD and MULLIGAN, Circuit Judges.
This is аn appeal from a judgment of the United States District Court for the District of Connecticut, Hon. Jon O. Newman, Judge, granting defendant‘s motion to dismiss the complaint for failure to state a claim pursuant to
The plaintiff, Joyce Shirley, commenced this action on September 12, 1972, seeking money damages, as well as a judgment declaring the Connecticut Retail Instalment Sales Financing Act,
The complaint alleged that on or about October 7, 1971, the plaintiff entered into a contract of conditional sale with Hart Volkswagen Corp. of West Hartford for the purchase of a Ford Thunderbird. The contract provided for 24 monthly instalment payments by the plaintiff starting on November 1, 1971. In the contract, plaintiff acknowledged receipt of an exact cоpy of the completed and executed instrument. The contract on its face warned the buyer not to sign if there were any blank spaces and advised the purchaser that she had the right to pay in advance the full amount due and to obtain a partial refund of the finance charge. The contract further advised that the purchaser had the right to redeem the property if it was repossessed for default, as well as the right to require, under certain conditions, a resale of the property. The contract defined defaults, which included the failure to pay any part of the purchase price when due. The plaintiff agreed to return the automobile in the event of default and fur-
On November 30, 1972, the defendant moved to dismiss the complaint for failure to state a claim pursuant to
The initial, and here the key question is whether or not the defendant Bank‘s peaceful repossession of the plaintiff‘s automobile on August 23, 1972, constitutes “state action” so as to support a claim under
The existence of state аction appears significantly in prejudgment seizures where a state official participates in the action which is the subject of complaint. Thus, in Sniadach v. Family Finance Corp., 395 U.S. 337 (1969), a court clerk‘s ex parte issuance of a summons, pursuant to a Wisconsin statute authorizing prejudgment garnishment of wages, provided a sufficient intrusion of the State to constitute state action. In Fuentes v. Shevin, 407 U.S. 67 (1972), state statutes authorized creditors to initiate replevin procedures by summary writs issued by state courts and executed by state officials. The seizure complained of here, on the other hand, was by a private individual without the intrusion of state process or stаte officials.
Nevertheless, it is established that a private person may act under color of law. “‘To act “under color” of law does not require that the accused be an officer of the State. It is enough that he is a willful participant in joint activity with the State or its agents.’ United States v. Price, 383 U.S. 787, 794 (1966).” Adickes v. S. H. Kress & Co., supra 398 U.S. at 152.
Has there been any joint activity between the State of Connecticut and the Bank in the repossession of the plaintiff‘s car? When the plaintiff purchased the Thunderbird on credit, she agreed to make monthly payments over a two-year period and on default agreed that the seller “may, with or without legal process, and with or without previous notice or demand for performance, enter any premises wherein the chattels may be, and take possession of the same. . . .” The plaintiff agreed in advance to the seizure of her vehicle. There was therefore no conspiracy between the defendant and the State of Connecticut, but rather a contract between the plaintiff and the defendant.
How then has the State of Connecticut become sufficiently implicated so that the seizure can be interpreted as state action? Plaintiff argues that
While Connecticut legislation unquestionably exists, we do not believe that this in any way constitutes such a significant state involvement as to constitute state action. The injury complained of here is the seizure of the plaintiff‘s car. Paragraph 5 of the complaint, entitled “Statement of Claim,” alleges that the Act, “§ 42-83 et seq., and in particular § 42-98, enables creditors and their agents to obtain immediate possession of goods from those lawfully in possession thereof, without the requirement of any prior hearing or of notice to those in said lawful possession.” But the statute did not authorize the seizure, as we have pointed out. Actually, the statute made the seizure more difficult. Since the passage of the Act, seizure can only be had if the seller has accorded the purchaser all of the protection set forth in the statute.4 Thus, the State does not encourage seizure, nor does it in any way aid or abet the seller. The partnership, if any, is with the purchaser and
We see nothing in Coleman v. Wagner College, 429 F.2d 1120 (2d Cir. 1970), relied upon by appellant, contrary to our position here. In Coleman, the State of New York had moved into the field of private collеge disciplinary procedures and enacted legislation, one purpose of which was “to deter student disturbances by the clear announcement of rules of conduct and of the penalties for disobedience.” 429 F.2d at 1126 (Friendly, J., concurring). It was the imposition of the disciplinary policy by the State which created the mischief complained of and allegedly constituted state action (a proposition not determined in that case). But here the State is not a “joint participant in the challenged activity.” Burton v. Wilmington Parking Authority, 365 U.S. 715, 725 (1961). The state enactment was amelioratory not regressive; it did not “move in” on the plaintiff or other buyers, but rather on the instalment sellers.5 See Fairfield Credit Corp. v. Donnelly, 158 Conn. 543, 264 A.2d 547 (1969), striking down waiver of defense clauses in consumer goods conditional sales contracts.
We are reduced then to the proposition that the mere fact that the State has legislated in the area of peaceful repossession constitutes sufficient participation to be appropriately denominated “state action.” As Chief Judge Kaufman pointed out in Male v. Crossroads Associates, 469 F.2d 616, 621 (2d Cir. 1972): “Although the mere existence of a state or federal regulatory scheme standing alone with nothing more is not sufficient to bring those regulated within the scope of the
The point is made decisively in Moose Lodge No. 107 v. Irvis, supra, where the Pennsylvania Liquor Control Board, in licensing the Moose Lodge to serve liquor, subjected the private club to detailed and extensive state regulation. The Court there held that “[h]owever detailеd this type of regulation may be in some particulars, it cannot be said to in any way foster or encourage racial discrimination. Nor can it be said to make the State in any realistic sense a partner or even a joint venturer in the club‘s enterprise.” 407 U.S. at 176-177. As we have indicated, since peaceful repossession existed at common law in Connecticut, the mere codification of that right does not, in our view, constitute state action. No delegation of traditional state power has been granted to any private person.
The appellant here relies upon Reitman v. Mulkey, 387 U.S. 369 (1967). That case involved an amendment to the California State Constitution, which barred the State from placing any limitation on the right of a person to dispose of his reаl property. The amendment, in effect, created a State Constitutional right to discriminate, repealing prior acts of the state legislature which had regulated racial discrimination in housing. The Supreme Court held that this effectively constituted state action which encouraged racial discrimination. The distinction is clear. The State of California by express Constitutional Amendment permitted what was formerly prohibited. Here the right to private repossession always existed. Codification did not encourage the practice one whit. As we have pointed out, the legislation made it less attractive by providing greater safeguards to the consumer in the conditional sales contract.
Although we believe that this sufficiently distinguishes Reitman, as the court noted in Adams v. Southern Cal. First Nat‘l Bank, supra, at 333, “we are not convinced that the resolution of the state action question involving prejudgment self-help repossession of secured property is controlled by a case involving racial discrimination.” Judge Friendly has also argued “that racial discrimination is so peculiarly offensive and was so much the prime target of the
We see no other theory of state involvement here which is possibly applicable. We recognize that the problems involved in determining whether “state action” is present are not susceptible of solution by facile formulae. Our examination of the Supreme Court decisions, as well as those of our own and other circuits, compels the conclusion, however, that none is present here.
Finding no state action, we affirm, without reaching the due process question.
IRVING R. KAUFMAN, Chief Judge (dissenting):
On or about August 23, 1972, the State National Bank of Connecticut seized a Ford Thunderbird in the possession of Joyce Shirley without so much as notifying her in advance, affording her an opportunity to abort the seizure at a prior hearing, or, by any other means, obtaining her meaningful consent.1 My brothers do not reach the question whether the Bank‘s conduct was in conflict with the fundamental safeguards provided by due process because they, like the court below, cannot discern the “state action” requisite to establishing a violation of the Due Process Clause of the
The linchpin of the majority‘s reasoning is that
since peaceful repossession existed at common law in Connecticut, the mere codification of that right does not, in our view, constitute state action. No delegation of traditional state power has been granted to any private person.2
Indeed, this reliance on the creditor‘s right to repossess at common law is highlighted by comparison of the instant holding with our recent decision in Hernandez v. European Auto Collision, Inc., 487 F.2d 378 (2d Cir. 1973). In Hernandez, we did not hesitate to reverse the dismissal of a complaint in an action where plaintiff challenged the constitutionality of the sale provisions of New York State‘s garageman‘s lien statute3 on the ground that the lienor‘s power to sell the automobile without an opportunity for a prior hearing violated due process. Yet, the only distinction, frail indeed, between this case and Hernandez is that the private power to repossess existed at common law while in Hernandez the lienor‘s right to sell the encumbered chattel did not.4 It is inconceivable that the fundamental right to be free of arbitrary deprivations of property should turn on the now disfavored theory of title passage5 upon which the dif-
fering rights of the conditional seller and the lien holder rested at common law. Instead, as one commentary aptly noted:
The fact that the law under attack is new and creates, rather than codifies, common law rights should not change the inquiry. The focus for state action purposes should always be on the impact of the law upon private ordering, not the law‘s age or historical underpinnings. Unless the law in some fashion significantly interferes with private ordering, the challenged conduct should not be attributed to the state. To make state action turn upon whether the statutory right being asserted has common law origins would lead to anomalous results. The identical private conduct, pursuant to the identicаl state statutory or judicial law, would be state action in some states while not in others depending solely upon the fortuitous and unimportant circumstance of the age and history of the law.
W. Burke & D. Reber, State Action, Congressional Power and Creditors’ Rights: An Essay on the Fourteenth Amendment, 47 S.Cal.L.Rev. 1, 47 (1973);6 Cf. New York Times Co. v. Sullivan, 376 U.S. 254, 265 (1964). Accordingly, unlike the majority, my analysis of the “state action” question begins rather than ends with the observation that the right of peaceful repossession without a hearing was recognized under the common law of Connecticut.
In merely codifying the common law right of repossession,
Why, after all, is the concept of due process considered so fundamental in our American constitutional system? Justice Harlan, in speaking for a majority of the Court in Boddie v. Connecticut, 401 U.S. 371, 374-375 (1971), eloquently opined:
Perhaps no characteristic of an organized and cohesive society is more fundamental than its erection and enforcement of a system of rules defining the various rights and duties of its members, enabling them to govern their affairs and definitively settle their differences in an orderly, predictable manner. Without such a “legal system,” social organization and cohesion are virtually impossible; with the ability to seek regularized resolution of conflicts individuals are capable of interdependent action that enables them to strive for achieve-
ments without the anxieties that would beset them in a disorganized society. Put more succinctly, it is this injection of the rule of law that allows society to reap the benefits of rejecting what political theorists call the “state of nature.”
Id. at 375. The crucial point, however, is that our system of laws is bedrocked in the principle that the State has a “monopoly over techniques for binding conflict resolution.” Moreover, the decisive difference between “binding conflict resolution,” on the one hand, and “private structuring and . . . repair,” on the other, is the element of voluntary, mutual consent, the presence of which permits the latter just as its absence requires the former. Accordingly, where, as here, the creditor is empowered, whether by common law or by statute, to unilaterally resolve a conflict, he is acting within a sphere reserved for the state alone аnd, therefore, his power, like state power, must be fettered by the restraints of due process.
American society, of course, bottoms its systematic definition of individual rights and duties, as well as its machinery for dispute settlement, not on custom or the will of strategically placed individuals, but on the common-law model. It is to courts, or other quasijudicial official bodies, that we ultimately look for the implementation of a regularized, orderly process of dispute settlement. Within this framework, those who wrote our original Constitution, in the
To be sure, Justice Harlan added that “private structuring of individual relationships and repair of their breach is largely encouraged in American life.”
Under the so-called “public function” test, then, self-help repossession is infused with the requisite “state action” because the creditor acts pursuant to a grant of the state‘s monopoly power to lawfully seize a significant property interest without the consent of the holder.9 I would reach the same conclusion by applying the “state action” analysis proffered by my brother Friendly in his oft cited lecture, The Dartmouth College Case and The Public-Private Penumbra (1968) at 18, since the ” . . . private action [self-help repossession] has resulted in a general and serious denial of values the [Fourteenth] Amendment was meant to protect. . . .” Accordingly, finding the Bank‘s summary seizure of plaintiff‘s auto permeated with the necessary “state action,” I would reverse.
Notes
As in Fuentes v. Shevin, 407 U.S. 67, 94-96 (1972), the fact that the plaintiff signed a form contract which authorized self-help repossession will not immunize a seizure, under a waiver theory, where it is otherwise defective because the property is seized without prior notice and an opportunity for a hearing. The absence of consent in the taking itself cannot be cured by resorting to the meaningless ritual of utilizing a contract of adhesion in which the fine print, even if read, fails to mention that the debtor has any right to a pre-seizure hearing.When the retail buyer is in default in the payment of any sum due under the retail instalment contract or instalment loan contract, or in the performance of any other condition which such contract requires him to perform, or in the performance of any promise, the breach of which is by such contract expressly made a ground for the retaking of the goods, the holder of the contract may retake possession thereof. Unless the goods can be retaken without breach of the peace, it shall be retaken by legal рrocess, but nothing herein contained shall be construed to authorize a violation of the criminal law. In the case of repossession of any motor vehicle without the knowledge of the retail buyer, the local police department shall be notified of such repossession immediately thereafter. In the absence of a local police department or if the local police department cannot be reached for notification, the state police shall be promptly notified of such repossession.